Artists and Canadian Tax Laws

You MUST know these interpretations of Canadian tax law, or you must give them to your accountant. They help you maximize your tax credits, minimize your taxes payable and explain repeat annual losses (if you have them).

Bulletin 504R2, “Visual Artists and Writers”

Online version here.

Bulletin IT514 “Work Space in Home Expenses”

Online version here.

Bulletin IT473R “Inventory Valuation”

Online version here.

There are many other interpretation bulletins that may be of interest to you at the CRA Site (claiming car expenses, claiming support payments, etc) depending on your circumstances.

Everything You Ever Wanted to Know About Social Media

From Mashable / Social Media: If you click Here you will go to a page where there are almost 300 features, galleries and how-to articles to help you understand the social media digital universe. Each feature is a post. The site is an aggregate resource of topics that are grouped for your convenience; some specific social media sites (Facebook, Twitter) have whole sections devoted to them. Other topics of particular interest include music, videos and photos, geo-location services, education, privacy and safety, social good, activism and government.

Sample Representation Contract Clauses

Sample contract clauses:

1. The artist agrees to provide the dealer with the quantity of artwork agreed to in their discussions. The work will be framed and in good condition; an artist’s statement will be provided as well as a full professional resume.

2. The artist guarantees that the artwork(s) provided to the dealer are the original creations of the artist; the artist hold all rights and copyrights attached to each artwork listed in Appendix A of this agreement; all descriptions and information provided about the artist and the artwork(s) are true and accurate. The artist agrees is responsible for any and all costs and expenses (including reasonable attorney’s fees) involved with any claims made that the artwork(s) is not an original creation of the artist or infringes upon a third-party’s copyright.

3. The artist retains all rights to the reproduction of the artwork(s). However, the artist permits reproduction of the following piece(s) for publicity purposes involved with the exhibition and sale of consigned artwork.
__________________________________________
__________________________________________
__________________________________________

4. The artist agrees to be a partner to the dealer in planning and executing advertising, merchandising and publicity involved with the exhibition and sale of the artist’s work.

5. The artist assumes all costs involved with packing, shipping and insurance, liability and all other handling expenses incurred in the delivery of the artwork(s) to the dealer.

6. The dealer accepts the consignment inventory listed in Appendix A of this agreement.

7. Any additional artworks by the artist placed on consignment with the dealer will be covered by the terms of this agreement and listed on a separate appendix bearing the signatures of all signatories to this agreement.

8. The dealer may display, distribute, exhibit and sell the artist’s work(s) of art but the artwork(s) shall not use the artwork for any other purpose without express consent in writing by the artist.

9. The artwork consigned for exhibition and sales will be numbered, signed described and priced at wholesale prices (based on your price rationale). The artworks covered by this contract are attached as Schedule A of this agreement.

10. The wholesale price of each artwork listed in Appendix A will be paid to the artist within 30 days of its sale.

11. The signatories to this agreement agree to meet and discuss their agreement in 60 days. If either party wishes to terminate the agreement at the meeting, all art shall be returned to the artist at the dealers expense (or held for pickup by the artist) and full payment for any sales will be made within 10 working days.

12. If both parties wish to maintain the agreement after the 60-day review, this agreement shall bind the parties for one year from the date this contract is signed.

13. The parties to this agreement will discuss renewal or an extension 30 days before this agreement is to expire.

14. Either party to this agreement can terminate their involvement by providing all other parties to the agreement with written notice to terminate the agreement giving 30 days notice. If the agreement is terminated, all art shall be returned to the artist at the dealers expense (or held for pickup by the artist) and full payment for any sales will be made within 10 working days.

15. The dealer agrees to work to the best of his/her ability to sell as many of the artworks by the artist as is possible.

16. The dealer agrees to pay all promotion, advertising and exhibition costs. In the case of “third party” exhibitions, the artist and dealer will work to terms set out in a written agreement they shall undertake.

17. The dealer agrees to properly label and identify all exhibited artwork with the artist’s name, the work’s title, media used and any related information deemed appropriate by the artist or dealer.

18. It is the dealer’s decision how many and how artworks will be displayed in the sale/exhibition space.

19. The dealer is responsible for all packing, shipping, insurance, liability and handling expenses involved with returning artwork to the artist, to buyers of the work and/or to any other sale/exhibition spaces negotiated by the dealer as agreed to by the artist.

20. The dealer is permitted to allow potential buyers to have possession of an artwork for 10 days on a sale-on-approval basis provided that the artist is informed in writing.

21. The dealer agrees to pay to the artist the wholesale price of an artwork (as listed in appendix A) within 30 days of the sale of the artwork.

22. The dealer and artist agree to the retail prices for the consigned pieces listed in appendix B. The dealer further agrees that any changes in prices will be agreed to in writing.

23. The dealer agrees to safely display and store the artwork and to insure them against theft, loss or damage. The dealer and his insurance agent agree to pay to the artist the wholesale prices listed in appendix A for any works lost or stolen.

24. The artist agrees that the dealer is not responsible or liable for the loss or damage to artwork(s) that results from natural disasters.

25. If the artist dies during the life of this agreement, the artist’s executor will have the right to terminate the agreement under the terms outlined for dissolution of the agreement outlined in clauses # __________ of this agreement.

26. The dealer agrees to provide a annual statement to the artist on the one year anniversary of this agreement or on termination of the agreement. It will list:

A. Works sold:
The title of the work sold
The date of sale
The sale price
The name and contact information of the buyer
Date of payment to artist

B. Works unsold being returned.

27. All communication required in writing and relating to the relationship between the signatories shall be sent to the addresses listed in this agreement. Both parties agree to inform all signatories of any change in their contact information.

28. This agreement and its signed amendments or additions shall constitute the entire understanding between the signatories.

Finally, there should be a clause that identifies the governing laws in case there is litigation between the signatories to the agreement such as: “The signatories to this agreement recognize that the agreement is governed by the federal laws of Canada and (your province).”

The agreement should end with all signatories signing and dating the contract in space provided. Some lawyers suggest that each party to the agreement also initial and date each page. The agreement should also provide for a witness’ signature and contact information.

Representation Agreements

The purpose of a good agreement is to cover, in writing, every single aspect of the relationship between the artist and the gallery in a way that is agreeable to both parties. A good contractual agreement has each party in possession of a signed and dated copy.

Artists entering this kind of relationship agree that the gallery/dealer has exclusive rights to the sale of the artist’s work and services in a defined market area (usually the city in which the exhibition/sales outlet functions — often an even wider market). A representation agreement can be negotiated to any mutually satisfying terms between the artist and the dealer—but there is usually a concern for exclusivity. In such an agreement, the dealer earns a percentage of all sales except on sales exempted by mutual arrangement.

Galleries, dealers, consultants, curators, and publishers, often have existing contracts. You should read them carefully and consider consulting peer professionals, a lawyer or a trusted artist-friend before signing one. You should strive to understand everything in the contract. If you have any questions about a clause, or if you feel a clause, as read, does not properly express its intent, ask the dealer/gallery to explain it for you in writing and append the interpretation to the agreement copies of both parties bearing the signed initials of the dealer.

Invest in your own contract—put together one that gives you confidence, building on an existing model. Sample agreements are available through various sources:

• From galleries, dealers or fellow artists.
• Professional development books and websites for visual artists
• From visual arts service organizations or clubs in your area

Artists are advised not to copy a standard agreement no matter how good it appears to be. All such sources should be viewed as advisory. They can provide guidance on language, structure and content with which they can become knowledgeable about the contractual agreement they are considering, but due diligence is the key. A modest investment of research, writing and legal consultation can provide artists with a contract for a lifetime. Perhaps the best source of contractual advice for visual artists (plus sample contracts) is CARFAC Ontario’s publication, “Artist’ Contracts.”

Preparing for an Interview with a Gallery

Some points to consider when having an interview with a prospective gallery/dealer:

1. Make a strong case for the marketability of your art—know why it will be bought (and your reasons should be compatible with the taste of the gallery’s clients or the mandate of the gallery). Be able to identify uniqueness in your work and have several points as to how you will produce sales (share information about your mailing list, past buyers, unique advertising opportunities you can access, you “personal markets” such as clubs you belong to, alumni organizations, church, etc.).

2. If there are sales hooks in your body of work, share them with your dealer. The more marketing ideas you have the better. Otherwise, your dealer may see markets for your work when reviewing your portfolio or as a result of seeing past exhibitions if you don’t have specific marketing ideas. (If, for example, you paint florals, have a list of botanical target buyers to offer as part of your contribution to sales.)

3. Be prepared to offer the dealer the names of references—people who have invested in you and love your work, people with whom you have worked, art teachers who have respect and faith in you.

4. If you are an articulate person, and you feel comfortable-to-confident talking to prospective buyers, offer the dealer those services. (Be careful; not all of you who love to talk have effective communication skills.)

5. Have considerable inventory available when you are seeking representation, and speak to an ability to produce enough inventory to satisfy the dealer over time. (Don’t make enthusiastic but unrealistic promises!)

6. Have (and state) a desire to stick with the dealer for the long term. In seeking a dealer you are asking someone to invest in you. They need to see a return on that investment that can often only be achieved over time.

7. Mention your capacity to get along well with people and demonstrate that capacity in all your interactions with the dealer and his/her clients.

CARFAC British Columbia Holiday Card

Selling to First-Time Buyers

What are the obstacles to buying art for those who have never bought before?

1. Insecurity
   • Feeling that they do not “understand” art well enough to buy
   • Fearing the negative judgment of others about their choices
2. Knowing nothing about you
3. Not knowing what “good” art is
4. Not knowing if your work will last
5. Not knowing what art is worth

You must address these issues when you are dealing with a first-time, reluctant or nervous buyer. You must exude your worthiAsk them: “Why are you buying original art?” Congratulate them on their decision to buy art; tell them how your work will address their desires.

1. Have your portfolio with you and keep your list of buyers (and all sections) updated.
2. Provide details about your most prestigious collectors/buyers.
3. Mention your favourable other experiences with first-time buyers.
4. Show them your reviews and publicity in your portfolio (but not outdated ones!).
5. Explain that you use a price rationale to ensure the ongoing market value of your work (making it a safe investment).
6. Talk about any exhibition experience, awards and/or commissions of significance—drop any names you can without being boring or obvious. Subtlety is good!
7. Ask where they would put your piece and offer ideas about presentation.
8. Talk about conservation: tell them why your work will not fade or decay.
9. Offer to deliver and help install your work; give them your contact information.
10. Offer to let them take it home on a trial basis if you trust them or if they leave a deposit (always check their ID and make note of all their contact information).

People need support in making a lot of purchases, not just when they buy art. Listen to them, look at them in the eye when you are talking together; be courteous and helpful. Use appropriate language; do not use “artspeak” with first-time buyers. Be helpful and encouraging.